Delivery Hero Concludes 2019 with Order Growth of 99% in Q4 and Invests Further for Growth

11 Feb 2020

by Press team

Berlin, 11 February 2020 – Delivery Hero SE (hereinafter referred to as “Delivery Hero” or “Company”), one of the leading global online food ordering and delivery marketplaces, announces its trading results for the full-year 2019 and the fourth quarter ending December 31, 2019.

2019 continued the Company’s strong momentum on all key financial and business metrics:

Delivery Hero grew fourth quarter revenues with 117% YoY and meets guidance with full-year revenues amounting to EUR 1.46bn. The preliminary EBITDA margin is expected to be negative at 29.6% for the FY 2019 or circa negative 6.0% as a percentage of GMV

Order growth further accelerated to 99% YoY in the fourth quarter (up from 92% YoY in the third quarter), driven by improved service offering and targeted investments into customer acquisitions throughout 2019. For the FY 2019 Delivery Hero grew orders by 80% to 666 million orders.

The adjusted preliminary EBITDA margin for the FY 2020 is expected to be between negative 14% and negative 18% as a percentage of revenue

Additionally, Delivery Hero will opportunistically deploy investments with a net adjusted EBITDA impact of negative EUR 200 million over the course of 2020 to take advantage of positive business performance and increasing food delivery market.

Niklas Östberg, CEO of Delivery Hero, commented:

“2019 has been a transformational year for Delivery Hero. We have been continuing our growth journey as a result of our unparalleled focus on customer experience. Our drive to deliver an amazing experience to our customers and partners all over the world has led to new initiatives and dedicated investments. Additionally, the strategic partnership with Woowa Brothers will reinforce our global leadership and further strengthen our position in Asia. I could not be more excited for the opportunities to come in 2020.”

Q4 2019 Key Operational Highlights

Strong growth driven by improvement in the service offering throughout the year:

Successful launch of “Pandamart”, a third-generation e-commerce platform in Asia

Becoming a Leading Instant Delivery App

Roll out of multi verticals in 11 further markets, now operating in 29 out of 44 countries

New verticals surpassed threshold of 1m orders per month

Growing importance of dark stores & kitchens will lead to change in reporting structure

Scaling Own Delivery at Positive Unit Economics

Own delivery today being at 44% of overall orders with expectation to increase own delivery share to a range of between 55% to 60% by the end of 2020 with only very moderate increase after that. The increase in 2020 is mainly driven by market mix effect

Own delivery rollout is predominantly focused on new cities & areas (own delivery currently offered in 450 cities globally)

Operational improvements led to a reduction in average delivery time to 28 minutes

Improved profit contribution per order valid for both, mature and early stage markets

Own delivery remains gross profit positive on a group level with own delivery profit contribution for group exceeding that of marketplace in some markets

Q4/FY 2019 Group Financial Performance

Order growth further accelerated to 99% YoY reaching 216 million orders in Q4 2019, up from 108 million in Q4 2018 (Q4 2018: 47% YoY)

Expected impact of Integrated Verticals to be smaller than 5% of segment revenues

Adjusted EBITDA margin expected to be between negative 14% and negative 18% as a percentage of revenues. Additionally, Delivery Hero will opportunistically deploy investments with a net adjusted impact of negative EUR 200 million over the course of 2020 to take advantage of positive business performance and increasing food delivery market

The Company will deploy continued investments into early stage markets but with EBITDA margin directionally improving. The flexibility of additional investments of up to EUR 200 million is intended to be opportunistically allocated to extend our leadership positions

1. MENA food delivery business is defined as the MENA segment excluding investments into dark stores and virtual restaurants.

Key Performance Indicators:

2. Americas revenues and GMV are impacted by the Argentinian operations qualifying as hyperinflationary economy according to IAS 29 beginning 1 September 2018. 2018 revenue is retrospectively adjusted.3.Included reported current growth rates for Argentina in our constant currency calculation due to the effects of hyperinflation in Argentina.

Definitions

The Reported Figures are calculated on proforma basis, i.e. adjusted for the divestments of foodora (Australia, France, Italy & Netherlands) and Germany. The numbers have not been adjusted for smaller acquisitions or divestments.

The group order growth would have been 93 % YoY if adjusted for all acquisition and divestments. The difference to the reported order growth is mainly related to the acquisition of Zomato UAE which is consolidated from 1 March 2019.

Gross Merchandise Value (GMV) is the total value of orders (including VAT) transmitted to restaurants.

Revenues presented for Delivery Hero represent the total segment revenues prior to discounts.

Since January 2019, Adjusted EBITDA is adopted for IFRS 16.

Constant currency figures provide an indication of the business performance by removing the impact of foreign exchange rate movements.

About Delivery Hero:

Delivery Hero is one of the leading global online food ordering and delivery marketplaces. The company maintains number one competitive market positions, in terms of restaurants, active users and orders, and online and mobile platforms, across 35 out of 44 countries in Europe, the Middle East & North Africa (MENA), Latin America and Asia-Pacific. Delivery Hero also operates its own delivery service primarily in over 600 cities around the world. The Company is headquartered in Berlin, Germany and has over 22,000 employees.

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Disclaimer:

The presentation contains forward looking statements, other estimates, opinions and projections with respect to anticipated future performance of Delivery Hero SE (“Forward-looking Statements”). These Forward-looking Statements can be identified by the use of forward-looking terminology, including the terms “believes”, “estimates”, “anticipates”, “expects”, “intends”, “aims”, “plans”, “predicts”, “may”, “will” or “should” or, in each case, their negative, or other variations or comparable terminology. These Forward-looking Statements include all matters that are not historical facts. They appear in a number of places throughout this press release and include statements regarding Delivery Hero SE’s intentions, beliefs or current expectations concerning, among other things, Delivery Hero SE’s prospects, growth, strategies, the industry in which it operates and potential or ongoing acquisitions. By their nature, Forward-looking Statements involve significant risks and uncertainties, because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking Statements should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. Similarly, past performance should not be taken as an indication of future results, and nor representation or warranty, express or implied, is made regarding future performance. The development of Delivery Hero SE’s prospects, growth, strategies, the industry in which it operates, and the effect of acquisitions on Delivery Hero SE may differ materially from those made in or suggested by the Forward-looking Statements contained in this presentation or past performance. In addition, even if the development of Delivery Hero SE’s prospects, growth, strategies and the industry in which it operates are consistent with the Forward-looking Statements contained in this presentation or past performance, those developments may not be indicative of Delivery Hero SE’s results, liquidity or financial position or of results or developments in subsequent periods not covered by this presentation. Any Forward-Looking Statements only speak as at the date of this press release is provided to the recipient and it is up to the recipient to make its own assessment of the validity of any Forward-looking Statements and assumptions. No liability whatsoever is accepted by Delivery Hero SE in respect of the achievement of such Forward-looking Statements and assumptions.